Digital is everywhere. We are in the midst of a digital revolution and it is changing everything: the way we recruit, the way we manage supply chains, the way we create products and services, the way we market and sell them.
The UK is at the forefront of this revolution and is fast becoming a digital economy. Last year, 12,000 digital businesses were created in the UK. It might be down to government, the availability of capital or entrepreneurial spirit. It doesn’t really matter: what matters is it’s happening and you need to know how it will affect your business.
Think big (data)
“Big data” is the way we look for insight. Previously, we called it data reporting, then management information, then business intelligence, now its analytics as the technology has improved significantly – put analytics on your CV, call yourself a data-scientist and you’ll get a bump in salary. But analytics is the difference between success and failure. In the US election Barack Obama had 10 times more people in his analytics team than Mitt Romney. He used the data to decide where to deploy resources and won the biggest prize of all.
We are working with a movie studio on using social media to predict ticket sales so they can decide whether or not to spend marketing dollars. Big name stars and a controversial topic isn’t a guarantee of success – there have been examples when analytics via social media has predicted that a film wouldn’t do well and it was right. We knew this not because we’re clever, but because that’s what the data told us.
The pace of change is staggering. In the time it has taken you to read this far, 168 million emails have been sent, 12,000 iPhone apps downloaded, 694,000 search engines queried. It is too big to get around. But it is creating more and more data for us to create value from.
The experience economy
We’ve had agricultural, industrial and services. Now we are transforming to an experience-based economy. The most valuable companies in the world today are experience companies: Google, Facebook, even Apple. The experience is what matters. Whether it is employees, investors, suppliers or customers, the experience they have in their interactions with you are what will differentiate you from the competition.
At the forefront of the experience are what I call “digital natives”. Chances are you are not one, unless you were born after 1985. Digital natives like to receive information quickly and visually. They want instant gratification and reward. The question is: how do businesses deal with them? 71% of digital natives would prefer to deal with a bank that is not a bank. That’s a problem for the banks on the high street. Do your stakeholders trust you?
The moment of truth
Every customer has a moment when they decide to engage with you and, before that, the zero moment of truth when they can be influenced. Before you spend a single pound on digital, you need to know what moment of truth you are trying to influence. Being very clear about the zero moment of truth ties your digital investment to a very tangible business outcome.
But there is also a second moment of truth, the moment when someone has had a positive experience and wants to share it. Every business can exploit that second moment of truth to get the first moment of truth from a new customer. Reward customers for positive reviews and feedback. Create more moments of truth and you will create more value.
The seven disruptions
There are seven forces at work in the digital economy that are either creating or destroying value:
- Social media
- Big data
- Cyber security
- The Internet of Things
- The Cloud
These are relevant for every company. Take “gamification”. If digital natives have grown up in a gaming world, how can we use games to improve productivity? KPMG worked with a large telecoms business developing a game-based process that made their engineers more efficient.
When you look at your business strategy, you need to think about how these seven things can be used to accelerate your growth. We are undergoing an evolution. We started with the physical world, then we went online, then we went multi-channel, now we’re omni-channel, where you can seamlessly follow a customer from one channel to another.
Digital is not about being all things to all people, it is about providing the right experience for your customers and future customers. Get it wrong and you won’t last long. Get it right and the rewards will be immense.
If you would like to talk about how any of these issues relate to your business then please get in touch – email@example.com